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Times have surely changed today.Those days have gone when an individual knew that he will retire from his work life at a time he will attain an age of 60 years. Youth and a majority of them thinks and believes to work hard and as much as they can in their youth and attain/accumulate all that wealth they will need to take care of their cash supplies regularly from the time they want to stop working.

When one think of retiring from usual day to day work life, what comes in the mind. Perhaps it is:

One self owned house a no EMI one of course.
A vehicle and a comfortable one to transport with.
Cash supplies that takes care of your monthly expenditure.
kids settled enough and are on their own.

No as such particular liability on you. So, that one has all that time in life for not to worry much about, and to do what one wish to do or had desire to do when he was actually busy out there building wealth. Something which is promoted big time on television commercials by most financial companies and banks in particular.

Somewhat a stage in life when your risks are all minimized, your liability are all done and you have all that wish and will to take up whatever you desired, and had been postponing for years.

But that is not easy as it has been read. Unless you are a millionaire’s child or a winner of some reality show somewhat that Big Boss kinds. Which makes you an instant millionaire you must start planning for your retirement. According to a statistics which I would like to share from a magazine only a little over 10% of India’s working population has any form of social security. This is because most of them have never ever planned or even thought of planning for their retirement. Try speaking to your parents on this and believe me they would regret on what savings they made in their accumulation phase of life. Infact, they were never left with much to save.

Another most important reason for you to undertake retirement planning is Inflation. Which I have been talking for quite some time now. The word which most of us are aware of and are familiar with but have ignored its important and the harm it can make to your money in the long term.

Did you know that Tooth Paste which you use today at Rs.80/- was somewhere around Rs.8/- fifteen years before and the petrol prices I remember was just Rs.28/- a liter now over Rs.50/-. Now, that is what the power of inflation is. It actually makes a dent in your entire budget. Now assume what it can do to you and your expenditure 25-30 years from now. If you wish to retire at an age assuming that you have enough to take care of your present standard of living you need to give a second thought.

Research says that given the current rate of inflation by 2017 the toothpaste will cost a little over a 120/- which you buy at Rs.80/- now. Don’t be surprised to find the price of petrol per ltrs at around Rs.250/-by then.

Another important expenditure you probably are missing out or is not coming to your mind now is the cost of medical services. At an age where probability of individual’s getting health problems are higher and it becomes a challenge to provide for the rising medical costs, which includes your spouses as well.

As life expectancy increases rising medical costs seems more daunting, especially since you will not have a regular income at that stage. This may seem scary now, but if you plan for it you will surely bridge the gap of uncertainties.

To make an informed decision one needs to understand all asset classes before committing yourself to any of the asset class. Risk appetite and understanding of the risk in different asset class and investment class in the longer time frames. One needs to evaluate his current asset allocation and find what percentage of them has to be allocated to achieve the given goals. What you also need to understand here is that how different asset class behave what is the nature of the asset classes and the importance of investing in them. With a keen understanding on these asset classes and their behavior in the short and the long run allocate proportionately to the assets keeping in mind your goals and your risk profiles.